The chapter budget is an intelligent estimate of all income and expenses necessary to assure the chapter of healthy financial operations for one fiscal year.

The budget is the foundation of fiscal affairs, so careful formulation is essential. The budget consists of two major sections: income and expense. The task is not so monumental as it may appear, for if you have the previous fiscal year budget, the job is reduced to analysis and compensation of unfavorable and favorable variances from the budget, adjustments for changes in income and expense, and any additions or deletions of accounts to provide a more meaningful control of funds. A word of warning though, the figures for the preceding year may not alone be sufficient; in fact the figures of one year should never be applied blindly to another.

The budget should not be treated as "just another" report. A budget prepared, filed and then never referred to is a waste.

Actual income and expense should be compared with budgetary amounts regularly. Provisions of the budget should not be exceeded unless the overall budget is revised accordingly. The budget should be modified upward or downward to meet actual conditions as the year progresses.

Comparison of actual figures to budgeted figures in each section will provide insight into the operating performance in the past quarter (a review of the economic performance of the chapter) and the fiscal year to date (a review of past performance as well as the effect of adjustments to achieve actual results-in accordance with the budget). You may want to create a monthly or quarterly financial statement to further help you review your progress. Large discrepancies indicate poor budgeting, poor financial management, or unavoidable or unforeseen contingencies. With continual referral to the budget and its relation to actual figures in the monthly or quarterly financial summary, both documents provide highly useful information when used regularly.

Two fundamental rules in developing a realistic budget are:

  1. Always over estimate expenses and under estimate income.
  2. Determine expenses first; then compute the necessary income to meet them.

The rough draft of the budget should be prepared in the spring while the past officers are present and before the school term ends. Each officer charged with the responsibility of requesting funds should plan his program for the coming year to determine what he wants to do and how much money it will take. The individual "budgets" should be submitted to the treasurer, at least four weeks prior to the end of the term.

Once the individual budgets have been submitted to the treasurer, the chapter's Finance Committee or Executive Committee schedules "budget allocation hearings" with the individual officers and committee chairmen. The purpose of these hearings is to provide each officer and committee chairman with the opportunity to explain to the committee how the money he has requested will be spent in his program. After all the hearings have been conducted, the Finance Committee/Executive Committee has the "final" responsibility for preparing the rough draft of the budget.

In the fall, when classes resume, the Finance Committee/Executive Committee can determine the actual income based on the number of members who returned and the success of the recruitment campaign (if applicable), and then prepare the final draft of the document. The final draft of the budget should project 10% more income than expenses to give some “breathing room”.

Some materials that will help the Finance Committee/Executive Committee accomplish its budgeting tasks are:

  • Last year's budget
  • Last year's quarterly financial summaries
  • Last year's bills
  • The checkbook and stubs
  • Next year's financial priorities
  • Membership roster
  • Recruitment Goal

Borradaile Metric Finance:

Each chapter will be required to submit a balanced budget to the Executive Offices in writing which results in a surplus for the upcoming fiscal year. The chapter shall determine the amount of the surplus. Approval of the entire budget by the Board of Governors and submission to the Executive Offices is required as prescribed by the Chief Executive Officer. Each chapter must pay all accounts due to the Executive Offices on time.

The budget for the year is due at the Executive Offices by October 15 of each academic year.


Techniques for Staying on Budget
Collecting Overdue Accounts
Brief Overview of Financial Terms

Unless otherwise stated, the content of this page is licensed under Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License

SSL configuration warning

This site has been configured to use only SSL (HTTPS) secure connection. SSL is available only for Pro+ premium accounts.

If you are the master administrator of this site, please either upgrade your account to enable secure access. You can also disable SSL access in the Site Manager for this site.